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Statement to York’s Senate regarding the Dahdaleh donation

Below is the text of Professor Ricardo Grinspun’s statement to the York University Senate regarding the decision to award Victor Dahdelah an honorary degree and rename a building on campus in his honour.

Earlier this month I wrote to Senate Executive asking for an item of Other Business to discuss the donation from philanthropist Victor Dahdaleh. I also put forward a hortatory motion that expressed disapproval of the university’s decision to accept a donation from him and to give him an honorary doctorate and name an important building and a research institute after him. Dahdaleh received an honorary doctor of laws degree on June 20. The TEL building has been renamed the Victor Phillip Dahdaleh Building in recognition of a $20 million donation, and the University has also announced the establishment of The Dahdaleh Institute for Global Health.

In the rationale for the motion, I wrote that given York University’s formal commitment to academic integrity and service to social justice, the University should not be honouring a businessman whose financial dealings have made troubling headlines[i] around the world or celebrating him as a representative of the university and as someone our graduates should emulate.

According to a news release from the CBC, Victor Dahdaleh has been featured in news stories about his “battle with criminal charges and a billion-dollar lawsuit on two continents over an international bribery scandal — all the while forging close ties with a trio of Canadian universities.” [ii]

Referring to the so-called “Panama Papers,” the CBC adds:

The huge leak of offshore financial records reveals Dahdaleh, a… metals magnate, is indeed, as long suspected, the mysterious middleman known in U.S. court documents as “Consultant A” — described as having handed out tens of millions of dollars in inducements to officials at a Persian Gulf smelting company in exchange for supplier contracts that went to one of the world’s biggest aluminum conglomerates.

Dahdaleh denies any wrongdoing and was acquitted in a British criminal trial, but his client, a unit of aluminum industry heavyweight Alcoa, pleaded guilty to a U.S. bribery charge in 2014 as a result of the scandal. With its parent company, it paid one of the biggest-ever anti-corruption penalties in American history — $384 million US.

York’s association with Mr. Dahdale has also become news. The Toronto Star reports[iii] that

The Canadian middleman in a massive international “corruption scheme,” in which U.S. officials say he “enriched himself” with $400 million (U.S.) in markups and made “at least $110 million in corrupt payments,” was celebrated by York University with an honorary degree Monday.

It’s the second prestigious honour Victor Phillip Dahdaleh has received from York recently. Last year, the university minted a new global health institute in his name following a $20-million donation Dahdaleh made to the university.

According to York’s guidelines on honorary degrees, “At this rite of passage [convocation] the University… personalizes its abstract ideals through the granting of honorary degrees to people whose achievements represent the values the University cherishes, whose benefactions have strengthened the community and the institution, and whose public lives are deemed worthy of emulation by the graduands.” The pervasive and widely documented questions about the ethics of Mr. Dahdale’s business affairs and the history of his money surely do not position him well to “represent the values the University cherishes” and thus, should have prevented him from receiving such an honor.

According to David Robinson, executive director of the Canadian Association of University Teachers,

There was clearly in this particular case some serious questions about the ethical behaviour of this individual … I think all the institutions have to practise a bit more due diligence… If there’s any concerns about violation of ethical standards or any other legal issues, donations should be rejected. I think it sullies the name of a university or college if it’s associated with an unsavoury business or character.

As the top body responsible for the University’s academic mission, it is incumbent upon Senate to express its view regarding the decisions that brought about such a negative impact on the University’s academic reputation.

What happened after I submitted the motion was instructive. Senate Executive, which in my interpretation behaved like an appendix of the President and Board of Governors rather than the executive of a deliberative body, chose not to rule the motion in order although they had no valid reasons to vote it out of order. Thus they simply excluded it from the Agenda package, sacrificing collegial governance and the right of Senate to discuss and express its view on a matter that has negatively affected York’s academic reputation.

These are usual results when rich men give donations to public institutions (on purpose referring to “men,” the source of most of these large donations). I asked that the “other business” agenda item be titled “Donation from philanthropist Victor Dahdaleh”. Senate Executive changed it to “Due Diligence in the Acceptance of Gifts and the Recognition of Donors.” This is misleading, as it suggests York lacked due diligence in checking Mr. Dahdaleh’s background. Is it credible that they knew nothing of these matters? Let’s face it: York went ahead fully aware of all the relevant information – it chose money over York’s values and reputation.

York is in good company here; Mr. Dahdaleh has been honoured by the London School of Economics and McGill University, among others. This does not seem to have sheltered Mr. Dahdeleh from critical reporting on his business achievements, as his legal battles are still the subject of news stories today.

The fact that Executive didn’t want Mr. Dahdaleh’s name in the Agenda item is not surprising. Academic freedom and free speech are often impacted by such donations, as the overriding motivation is to get the money. An implicit or explicit part of the agreements is branding, and for the donor, the opportunity to buy respectability, since their main line of business may give them power and money but not necessarily respectability.

In the secret agreement for Peter Munk’s donation to U-T – later leaked out and now available online – the protection of his branding is spelled out as a commitment. Secrecy and a perversion of academic planning – affected by those confidential agreements – is now inherent to these donations. At York, the secret agreement with Seymour Schulich has allegedly influenced academic planning for decades, and we don’t know if secret agreements with other York benefactors are also secretly influencing decisions on, for example, the organization and ranking of disciplines, the distribution of full time faculty hiring among different faculties, or research priorities.

All this represents an aberration of public policy, part of a gradual privatization of university education. As governments curtail funding, the pressure to seek private funding increases. Since donations represent capital funding, they distort forever the distribution of operational funding that must support the university’s intellectual and physical infrastructure. As donations represent massive legal tax avoidance mechanisms, much of this money comes from you and me, and from the students’ parents, not from the donor. Government often steps in to match the donor’s money, thus increasing public expenditures for private priorities. In the case of the infamous CIGI agreement with York, which was rejected by the faculty of the Osgoode Law School for its interference with academic freedom, most of the money would come from the public, not from Jim Balsillie.

The matters here are consequential. York is currently searching for a new president and the terms of reference speak directly to her/his ability to bring big money for York’s recently announced major fundraising campaign. Upholding York’s values and attracting big financial donors often do not go hand in hand. Which will have the upper hand?